How much money will I need at closing on a USDA Loan?

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Ok, I have had a lot of information thrown at me in the past few months and everything seems to be blending together. I am in the process of getting my first home and am using USDA. Purchase offer, all inspections, and appraisal are done. Has anyone gone through the USDA closing process? How much, if any, monies will I need at closing? I don’t want any secret fees thrown at me. Any help is appreciated.

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2 comments to How much money will I need at closing on a USDA Loan?

  • Iffy  says:

    Same as all closings average is 6% of home costs.

  • Bob  says:

    The USDA program actually allows you to include you closing costs in the loan as long as the loan does not exceed the appraised value. If you buy a home for $100K and it appraises for $103K you can finance $3000 of your closing costs. Most of your closing costs are fixed, and don’t depend on the amount of your loan. The only fees that vary with your loan amount are title insurance and the origination fee if you have one. Not all mortgage loans do. After the appraisal is complete your lender should be able to tell you if you can include the fees or if you need to pay them at closing.

    Your lender is required to provide you with a Good Faith Estimate that should give you a pretty accurate idea of the funds you will need at closing. They are required to be 100% accurate in the estimate for many of the fees and within 10% of the others. They cannot throw “secret fees” at you unless there is a legitimate change in circumstances such as an appraisal coming up short or requiring additional repairs or inspections.
    Your lender can’t control the closing date or the cost of your home owner’s insurance, so the interest and insurance due at closing will be an estimate until you are approved and scheduled to close. Everything else should be fairly predictable, so talk to your lender about getting the most up to date estimate of the amount you need to close.

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